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What is the average Gross Rent Multiplier (GRM) for small multifamily complexes (1-4) in Galt?

  • July 09 2009 - Galt
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Answers (3)

Guys GRM - Gross Rental Multiplier is SALES PRICE / Annual  RENT. BEST not to rely on them, as numbers are affected dramatically by existence of HOA and assessments. Factors like Seller Financing or rates on mortgages make a huge difference as well as area upside or vice versa.

They can range from 20 to 5 for the most part.. please use CAP rate instead and shoot for 7 - 10 % (the higher the better), or contact me, the investment expert who currently has a BLOW OUT INVESTMENT PORTFOLIO from a motivated Seller due to Divorce!

Anya Nevtonova, Broker Associate, Keller Williams
  • January 09 2014
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The average Gross Rent Multiplier is 5.0, a real estate investment property with a higher Gross Rent Multiplier (perhaps over 12) is a poorer opportunity, whereas a real estate investment property with a lower one (perhaps under 9) is better. A Gross Rent Multiplier of zero would be good, but highly unlikely.
  • August 22 2010
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If you want the actual GRM for your area contact a local Realtor and they can crunch the number for you, however if you are trying to deteremine whether a given property is a good investment or how to price one, I recommend staying away from GRM.  An investor should be making offers based on his required rate of return,  A complex should generally be priced in the same manner.

There are several good measures; Cap rate, ROI, and Cash on Cash.  All of them should be applied to determine a reasonable price.
  • July 10 2009
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